Kaye said Harbour created the fund initially to cater for wholesale clients – such as charities and community trusts – seeking greater yield in a low interest rate environment.

“With interest rates so low, wholesale investors who need regular income either have to adjust down their expectations or move up the risk profile to improve yields,” he said.

Kaye said while introducing equities into the mix does introduce heightened volatility, the Harbour process is focused on identifying high-quality Australian stocks with strong dividend potential.

According to the Harbour website, the “manager would rather spend the risk allocation within the equity portion” of the Income fund than seek higher yields in sub-investment grade bonds.

The retail Income fund would pay a fixed quarterly distribution of 1.25 cents per unit.

“The feedback from advisers was they wanted certainty of income and stable cash flows,” Kaye said.

Kendal Law, Harbour head of sales, said the T Rowe Price Global Equity Growth Fund should also appeal to retail investors.

Law said the underlying T Rowe Price fund invests into about 130 global stocks, offering wider diversification than most actively-managed international share products available in New Zealand.

Harbour launched a wholesale PIE version of the T Rowe Price fund this February, hiring Law to provide marketing support.

In light of the heightened volatility in emerging markets, he said some advisers were concerned about the reasonably high allocation to that sector in the T Rowe Price product (ranging between 18-25 per cent).

“But the interesting thing about this fund is that it’s not benchmarked to emerging market indices,” Law said. “In fact, recent volatility has been in line with the broader global equity index – but you’d assume it would be higher with its bigger exposure to emerging markets.”

He said the “unconstrained” approach of the T Rowe Price process meant it could avoid investing in Chinese banks or Russian stocks, for example, which feature in emerging market benchmarks.

To date, the Harbour/T Rowe Price wholesale global equity fund has garnered about $10 million while the Income product sits at roughly $70 million, Kaye said.